S&P 500 recedes from record highs as tariffs sour sentiment

In Europe, where investors were awaiting news of Trump’s new tariff level targeting the European Union, the Paris stock market dropped 0.9 per cent and Frankfurt 0.8 per cent.

“The fallout hasn’t been more pronounced because the market still continues to view all of this as a point of negotiating leverage,” said analyst Patrick O’Hare of Briefing.com.

Trump dialled up his trade war rhetoric Thursday, warning that Canada faced a 35 per cent tax, while other countries would be handed blanket tariffs of up to 20 per cent, from the current 10 per cent.

That came after he outlined plans to impose 50 per cent tariffs on copper imports, while threatening 200per cent levies on pharmaceuticals, and hit Brazil with a new 50 per cent charge.

The moves are the latest by the White House in a campaign it says is aimed at ending decades of the United States being “ripped off”.

Trump’s initial bombshell tariffs announcement in April sent markets into turmoil until he paused them for three months, and the latest measures have had less impact.

London’s FTSE 100 and the pound retreated after data showed the UK economy unexpectedly shrank in May – its second consecutive monthly decline.

That followed a mixed session in Asia, where Hong Kong rose, Tokyo fell and Shanghai flattened by the close.